Overseas Highway: The Impact of Roads on Real Estate in the Florida Keys

The development of Florida Keys real estate is directly linked to the creation of roadways in the islands. Before the chain was connected to the mainland of Florida, homes in the Florida Keys were sparsely inhabited by the early pioneers making a living primarily by growing crops like pineapples and limes. Most of the land was either undeveloped, or used as working farmland.

The revolution in Florida Keys real estate began in 1912 when Henry Flagler completed his Overseas Railway. Flagler’s vision was to extend his Florida East Coast Railway that he previously had built to connect his business ventures throughout Florida, all the way down to Key West. Flagler recognized the new business and trading opportunities that were opening up at the time because of the construction of the Panama Canal. Flagler was looking to capitalize on trade with South America as well as with the American West, and needed the deep water harbor at Key West in order to do that. He spent the next several years seeing his vision become a reality.

By 1912, the railroad stretched all the way down to Key West, and the Keys became easily accessible. With the railroad came an influx of goods and people into the Florida Keys. Post offices were established first, and people began to move into the area as new jobs became available.

One of the most important events in the history of the regions real estate was the Labor Day Hurricane of 1935. The hurricane completely leveled much of the Keys, including Flagler’s Overseas Railway. When Flagler’s company went bankrupt after his death, they lacked the funds necessary to rebuild the railroad. Left with no other option, the railroad was sold to the State of Florida. Florida government officials had their sights set on transforming the railroad into a highway. Since the railroad had brought larger numbers of residents to Florida Keys real estate, it seemed only natural to facilitate even more movement throughout the area. Additionally, the hurricane brought in a new wave of real estate in the Florida Keys, with homes needing to be rebuilt.

The Florida Keys was transformed by the Labor Day Hurricane of 1935. Florida Keys homes needed to be rebuilt, and many new neighborhoods were created. Henry Flagler’s damaged Overseas Railway that connected the Keys to the mainland of Florida was sold to the state to be converted into an automobile highway. The creation of a highway throughout the Florida Keys was hugely important to the development of real estate in the area. While it is generally remembered that the highway came about as a result of the hurricane destroying the railroad, the history of the Overseas Highway begins much sooner than that.

The early part of the twentieth century saw a huge land boom for real estate in South Florida. Land developers and entrepreneurs were building up areas like Miami Beach, Coral Gables, and Coconut Grove. Real estate in the Florida Keys became highly desirable, but highly difficult to get to, with the only way to get to the area being by railroad.

In 1919, talk of the necessity of building a highway really got underway. The discussion had two primary players: the Miami Motor Club, who wanted to provide tourists with the unparalleled fishing grounds of the Florida Keys; and land developers who knew that a roadway would provide access to the untapped Florida Keys real estate market. Left to figure out the logistics of the construction were the county commissioners of both Dade County and Monroe County. The county commissioners decided to build the highway following the route of the railroad. They ran into trouble when the Miami Motor Club spoke up in opposition. Since their motives were to bring tourists to the Keys for fishing, they wanted the roadway to follow the fishing routes along Card Sound. After much debate, it was decided that the road would follow the fishing route of Card Sound. With the initial decision made, construction could begin.

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The Overseas Highway, from the beginning of its construction, greatly contributed to Florida Keys real estate. When initial construction began, it was a joint venture between Dade and Monroe County. Dade County was responsible for building a connection to the county line where Dade becomes Monroe County. Residents of Monroe County approved $300,000 in bond money for the road that began at the Angler’s Club in Key Largo, followed down the coast toward the Key Largo Depot, and made its way along the railroad line to Matecumbe homes. This was to be the roadway of the Upper Keys real estate. Additionally, Monroe County also approved another stretch of road in the Lower Keys.

The beginning of construction on the Overseas Highway immediately jump-started the Florida Keys real estate market. The Upper Keys became home to many subdivisions, the first of which was the North Carolina Fishing Village in 1924. The following year saw Angler’s Park, Angler’s Shores, Sunset Cove, Palma Sola, Key Largo City Gardens, Seaside, Atlantic View, B.C. Moreno’s, Thompson’s, Tavernier, and Tavernier Cove. Islamorada was quickly becoming one of the most popular areas with its subdivisions as well. With the subdivisions came many people quickly purchasing property in the budding Florida Keys real estate market, and coming by train to survey the land. This influx of people made it necessary to further add residential roads as well.

One of the primary land developers of Upper Florida Keys was Charles Sexton. Sexton purchased much of the land around the Key Largo Depot with the vision of building the “Venice of the Keys.” Much of the early development of Key Largo homes owe their beginnings to Sexton. This area today is known as Sexton Cove.

The initial $300,000 bond given to the builders of the highway quickly ran out, and another vote was necessary. An additional $2.5 million was given for the project. However, even this with cash infusion, the immediate future of traveling throughout Florida Keys real estate would rely on the use of ferries.

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The initial development of real estate in the Florida Keys largely depended on the building of the Overseas Highway. Monroe County began construction on the Card Sound pass to connect the Upper Keys to the extension that Dade County was building. At the same time, a roadway was being constructed in the Lower Keys to connect Key West all the way to No Name Key. While roadways were underway in the Upper Keys and Lower Keys, the middle of the chain of islands was left undeveloped. Therefore, in order to travel the entire way north or south, ferries were needed to traverse the water. Employing three ferries purchased for $850,000 from Gibb’s Shipyard in Jacksonville, the Overseas Highway was officially opened on January 25, 1928. Florida Keys real estate was free to continue developing.

While travel to and from Key West was impossible without the ferries, it was not the ideal solution for the roadway. One ferry was designated for the northbound route, one for the southbound route, and the third was kept in case of emergency. Each trip was 41 miles, and took approximately four hours to complete. Additionally, only 20 cars could fit on each ferry. This time-intensive trip cost $3.50 for passenger vehicles. The driver was included in this fee, but each additional passenger was charged $1.00 for the passage.

With traveling throughout the Keys much more accessible, and more people traveling throughout the area, homes in the Florida Keys began springing up throughout the islands. More people meant more residential roads being built.

Quickly, however, people realized that the ferries were unreliable and too time-consuming, so plans were made to find a solution that eliminated the need for the ferries. The problem came when the Army Corps of Engineers went to estimate the cost of filling the gap with a bridge built over the water. The estimate came at over $7.5 million, a huge cost when the United States economy was in a major depression. The future of the Overseas Highway was now in the hands of the president, Franklin Delano Roosevelt.

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The need to replace the slow and unreliable ferries that were required to complete the trip to Key West came a huge price tag of $7.5 million. When the request for funds was sent to Washington, Roosevelt approved the project, but with the nation in an economic depression, no money was sent. With no option and no money, Monroe County and Key West simultaneously filed for bankruptcy. The future of Florida Keys real estate was in jeopardy.

While all of this was going on, Washington was being bombarded by war veterans seeking to gain access to their bonus for fighting in World War I. Roosevelt came up with a plan to take care of both problems at one time, and through the Federal Emergency Relief Administration (FERA), sent the veterans to the Keys to work on the bridge.

In 1935, Florida Keys real estate was slammed by a major category five hurricane. One of the primary casualties was Henry Flagler’s railroad. With the majority of the real estate in the Florida Keys located in Key West, it was vital to the success of Monroe County to either rebuild the railroad or finish the highway. With the Florida East Coast Railway bankrupt, it was sold to the State of Florida for the completion of the highway. Capitalizing on loans and the promise of toll money, the Overseas Highway was finally open for automotive traffic in 1938.

Throughout the years, changes have been made to the highway, and renovations have been completed, particularly to the Seven Mile Bridge. Despite the changes, the huge impact on the Keys is obvious. Because of the Overseas Highway, people began moving in large numbers to homes in the Keys. As real estate began developing, other industries developed as well. Without the Overseas Highway, real estate in the Florida Keys would not have developed as quickly or with as much importance. The Overseas Highway was the catalyst for development, and the link for homes in the Keys to the mainland. Today, homes for sale in the Florida Keys are highly in demand for those seeking a leisurely lifestyle. This lifestyle, however, was forged on the backs of those who built the first roads throughout the Keys.

Visit our Key West Real Estate resource center for additional information about topics that affect the real estate in that region.